Big Pharma’s Go-To Defense of Soaring Drug Prices Doesn’t Add Up

How is it that pharmaceutical companies can charge patients $100,000, $200,000, or even $500,000 a year for drugs—many of which are not even curative?

Abiraterone, for instance, is a drug used to treat metastatic prostate cancer. The Food and Drug Administration initially approved it in 2011 to treat patients who failed to respond to previous chemotherapy. It does not cure anyone. The research suggests that in previously treated patients with metastatic prostate cancer, the drug extends life on average by four months. (Last year, the FDA approved giving abiraterone to men with prostate cancer who had not received previous treatment.) At its lowest price, it costs about $10,000 a month.

Abiraterone is manufactured under the brand name Zytiga by Johnson & Johnson. To justify the price, the company pointed me to its “2017 Janssen U.S. Transparency Report,” which states: “We have an obligation to ensure that the sale of our medicines provides us with the resources necessary to invest in future research and development.” In other words, the prices are necessary to fund expensive research projects to generate new drugs.

This explanation is common among industry executives. To many Americans, it can seem plausible and compelling. It’s easy to conjure images of scientific researchers in their protective gear and goggles carefully dropping precious liquids into an array of Erlenmeyer flasks, searching for a new cure for cancer or Alzheimer’s. But invoking high research costs to justify